Nonprofit outlines plan to acquire, rehabilitate two Chester affordable-housing properties

The Merry Fund, a Connecticut-based nonprofit, told the Chester Housing & Community Development Committee on April 14 that it plans to acquire two troubled project-based properties — Benjamin Banneker and Daniel Scott Commons — and pursue a financing package to fund a comprehensive rehabilitation.

The Merry Fund’s chairman, Frank Farica, told committee members the organization would not seek direct city grant money and that the nonprofit will invest its own funds and pursue state and federal resources. “I’m not here to ask you for money,” Farica said. He said the nonprofit would apply for Low-Income Housing Tax Credits and seek an adjustment to the existing HUD project-based contract so the properties could support larger debt service while keeping tenant rents unchanged under the subsidy rules.

The plan targets two distinct properties. Jeremy Filo, president of KMA Design Studio, said Benjamin Banneker — a mid- or high-rise building — needs deep infrastructure work, including electrical, mechanical, plumbing, envelope and accessibility upgrades. Filo estimated roughly $155,000 in construction cost per unit for Benjamin Banneker and about $145,000 per unit for the garden-style Daniel Scott Commons, which he described as requiring significant energy-envelope and interior repairs. Farica said Banneker now has about 70 units and Daniel Scott about 71 units.

Farica told the committee the projected acquisition price to satisfy the current lender is $4,000,000 and that total rehabilitation costs make the project a multimillion-dollar undertaking. He said the Merry Fund has budgeted about $700,000 to cover interim relocation or temporary housing for tenants during phased rehabilitation and that the nonprofit expects to absorb approximately $600,000 of development application costs to advance the financing package.

On financing, presenters described a two-part strategy: (1) seek adjustments to the existing HUD project-based contract to permit upward subsidy adjustments tied to rehabilitation, and (2) pursue Low-Income Housing Tax Credits through the state allocation process. Farica said counsel and contacts in Congresswoman Scanlon’s office advised that the city’s active support — for example, letters or prioritized project status — would improve the project’s prospects with HUD and in competitive state processes. “It just helps us to get to a better spot than it would if the city were agnostic about the project,” he said.

Committee members pressed presenters on tenant impacts and timing. Farica said the nonprofit would not raise tenant rents and that tenant contributions would continue to be calculated as 30% of income under the subsidy program: “I have no problem at all in making the categorical statement that we would not raise the tenant’s rent.” He also said HUD rules protect tenants from permanent displacement under existing HAP arrangements and that the Merry Fund would use an in-place, phased relocation (using currently vacant units, or hotels where necessary) to avoid permanent displacement.

Presenters gave a tentative timeline: the Merry Fund hopes to assemble the financing package within roughly 12 months and estimated construction would take about 12–16 months once financing is in place. On a scale introduced in the meeting, Farica estimated an approximately 0.8 chance (80%) of pulling the financing together after initial due diligence during the first 30 days.

Committee members asked for documentation. Farica and Filo said they would provide the committee with the Merry Fund’s project history, a detailed sources-and-uses budget, and relocation plans. Lisa Gaffney, director of the Chester Economic Development Authority, requested the full financing breakdown and confirmation of which funding sources would cover tenant relocation; presenters said they would not move residents until required funding was secured.

The nonprofit emphasized it is a rehabilitation-focused organization and not a ground-up builder; Farica said the group has completed 14 projects since its founding in 1979 and that those projects are functioning. The presenters also noted the site currently has a low HUD condition score and that the lender and city enforcement actions risk leaving tenants with vouchers if no rehabilitation occurs.

Votes at a glance: The committee approved the minutes from the March 24, 2025 meeting by voice vote at the start of the session. No other formal votes or approvals related to the Merry Fund presentation were taken during the meeting. The Merry Fund will supply materials to City staff for distribution to committee members.